The Problem with Food Stamps

Low standards, low compliance blunt the impact of nutrition assistance programs

Published in CSP Daily News

By  Abbie Westra, Editor-in-Chief, Convenience Store Products

[The second in a three-part series examining the battle against food deserts.] CHICAGO -- Many convenience-store retailers have customers who rely on federal nutrition assistance programs to buy food. Approximately 33.7 million Americans were using "food stamps"--known more recently as electronic benefits transfer (EBT) cards--to purchase food in 2009, according to the most recent figures from the U.S. Department of Agriculture.

Because of the vital role these programs play to low-income consumers, public health advocates consider these programs an essential link--and [image-nocss] one of the biggest roadblocks--to improving the public's health and eliminating food deserts, or areas where little to no healthy food is available for purchase.

While standards may vary by state, participants in the USDA's Supplemental Nutrition Assistance Program (SNAP) can use their benefits toward any food or food product--not including foodservice items. This, said Mari Gallagher, principal of Chicago-based Mari Gallagher Research & Consulting Group, is part of what feeds the poor nutritional outlook for lower-income Americans and helps perpetuate the food-desert issue.

"There are two problems: One, the standards are too low; and two, we're not meeting the standards," Gallagher told CSP Daily News.

The typical SNAP household had gross income of $711 per month, according to the USDA, with SNAP benefits supplying more than 27% of a household's monthly funds. Nearly one-half of participants are children.

A retailer accepting SNAP benefits must offer at least three varieties of meat, poultry or fish; bread or cereal; vegetables or fruits; and dairy products. Perishable foods must be available in at least two of these food groups. Finally, more than 50% of the total retail sales--including gas--must come from the eligible foods.

It is difficult to determine exactly how many retailers meet these broad standards. Gallagher's analysis of retailers that accept SNAP in Detroit, for example, found that 92% of them qualified as "fringe"--or unable to support a healthy, balanced diet. The USDA had wrongly categorized many as midsize grocers when in fact they were liquor stores. Some retailers sold raw produce but then offered to fry it for free--"You buy it, we fry it"--which is against regulations.

"People don't want to look at this because they don't know how to deal with it," said Gallagher. "It's not popular to spend money on compliance, and the retail industry is not favorable to compliance, even though most of the traditional retail industry probably complies."

She suggests tightening the standards even more and turning enforcement over to local health departments. Gallagher also has petitioned the White House to appoint a task leader to work with industry, community and other leaders on new SNAP standards and compliance.

The Women, Infants & Children (WIC) program, which serves 9.3 million low-income mothers and their children up to age 5, has more stringent standards, which vary by state. Cereal, fruit and vegetable juice, eggs, milk, cheese, peanut butter and beans are a few of the common qualifying foods; whole-grain and soy-based foods were added recently.

Martha Page, director of the Hartford Food System, a healthy corner store initiative in Hartford, Conn., told CSP Daily News retailers in her program who are WIC-certified show a greater willingness to offer healthier groceries. This is because USDA restricts the number of WIC-certified operators in a given area, which makes the distinction valuable to retailers, and compliance somewhat easier to enforce.

This doesn't mean WIC and other programs are infallible. For example, in Minneapolis, a Staple Foods ordinance requires retailers with a grocery license to carry a variety of five perishable produce items. A 2009 survey of such retailers found, however, that most stores weren't in compliance with this standard. If they carried any type of staple produce item, it was typically those with the longest shelf life, such as onions and potatoes, and they were located randomly throughout the stores.

Regardless of whether low standards or low compliance is the core issue, retailers do value the programs, not only for the revenue they bring into stores, but also for their ability to shape low-income consumers' shopping behavior, and the potential for increasing demand for healthier food offerings.

Peter Larkin, president of the National Grocers Association, calls the programs critical. "If we were looking at major cutbacks in food stamps and WIC, it is going to set back our efforts and opportunities to put more stores in food deserts, there is no question about it," he said. "Those people don't have, in most cases, the disposable income to be able to buy nutritious foods without some kind of assistance."

For more on the battle against food deserts, see the June issue of CSP magazine.

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By Abbie Westra, Editor-in-Chief, Convenience Store Products
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